China Blocks Meta’s $2bn Acquisition Of AI Startup Manus
China has halted Meta’s planned $2 billion acquisition of Chinese-founded AI startup Manus, signalling growing concerns over the transfer of sensitive technology amid escalating tensions with the United States.
In a brief statement issued Monday, Chinese authorities ordered both parties to unwind the deal following an earlier probe into the transaction. The move underscores Beijing’s increasing scrutiny of cross-border investments in critical sectors such as artificial intelligence.
The decision comes ahead of a highly anticipated meeting between Donald Trump and Xi Jinping, where trade and technology disputes are expected to feature prominently.
Analysts say the intervention reflects a broader trend toward the fragmentation of global technology development, as competition between the US and China intensifies. The move could also have a chilling effect on China’s startup ecosystem, particularly for firms seeking international expansion or investment.
Unwinding the deal may prove complex. Since announcing the acquisition in December, Meta had already begun integrating Manus into its operations, with some of the startup’s executives joining the company.
For Meta, the blocked acquisition represents a potential setback in its efforts to strengthen its AI capabilities amid growing competition from rivals such as Google and OpenAI.
Responding to the development, a Meta spokesperson said the transaction “complied fully with applicable law,” adding that the company expects “an appropriate resolution” with Chinese regulators.
Manus gained industry attention after launching an autonomous AI agent capable of performing tasks on behalf of users. However, public sentiment in China shifted after the company relocated its headquarters to Singapore and later agreed to the sale, with some critics accusing it of “selling out” to foreign interests.
Chinese authorities launched a formal investigation into the deal earlier this year, reportedly aiming to discourage similar moves by domestic startups. Reports have also indicated that Manus co-founders Xiao Hong and Ji Yichao are currently under travel restrictions as part of the ongoing probe.
The outcome of the case could shape future cross-border tech deals and influence how Chinese startups navigate global expansion in an increasingly divided technology landscape.
